I bought a large amount of shares of WM when it was $2.00 a share last week and am very tempted to sell into this rally where its above $4 now in premarket. However, there is a ban on short selling of financials and the government is "set" to announce a plan to help banks with their mortgage debts. If that is true, wouldn't that mean banks like WM would soar much higher? All of its problems are related to mortgages and it can no longer be shorted (for now anyway). What do you guys think is the appropriate action? I don't want to get too greedy but I don't want to get out now if its on its way to $10 a share.
its very difficult to have a plan when market circumstances change so drastically from day to day, i dont think anyone could have predicted what happened today... but thanks for your advice
Hrm.... just a hunch, you might be witnessing the squeeze of the century. WM's float is 22% short. If it get anywhere close to 5 to 10 bucks. Watch out.
It is tough and it's tougher to stick with a plan. I fucked up and listened to the "experts" on FRE and FNM a few weeks ago and got out taking a pretty big loss. Had I stuck with "my" plan it would have played out as I planned, 3-4 days later making me almost as much as I lost. I got into WM a little higher than you (kicking myself for it) and would have gotten out when it was trading $4.00 to $4.08 if eTrade would have recognized it WAS in my account. I admit I wished I had acted earlier and would have gotten out closer to the top. I'm still sitting on it with the same thoughts as you. It seems to be laying down when so many things say it should have moved and be moving higher. Maybe it'll launch hard and we'll be in good shape, maybe we'll be stuck looking stupid trying to control our losses in it. It's hard to stick to my plan when I can't play it out and game pieces have changed. But I've sat on things too long and lost my ass before. I'm a little anxious over this. Hell, I was about to jump out of BRK this AM the excitement and profits looked so good. But I'm trying to stick with my plan.
It doesn't take a genius to figure out that stock price = demand of stock - demand of short. When gov change the rule to : stock price = demand of stock It change the fundamental rule of the market. Add to the fire, it also ban naked shorts that are hanging around. I don't know where this number is documented, but this is certainly not fair.
I was about to start a WM thread. WM is a lock here at $3.90 to buy. A deal at $8.00, or no deal and Fed RTC action.
I may regret this decision but I think i'm going to hang onto WM for a while longer. i just feel that its main concerns are being addressed by the government (which is probably why it has risen the most percentage wise in the past 2 days). The main fault that everyone attributes to it is all the bad mortgages they have. However, the plan the government will be working on over this weekend will address that directly. and the temporary ban on short selling definitely is a help. Naked short selling is also no longer allowed so there are no shorts aggressively taking this stock down. Taking all that into consideration, i believe there is a decent chance for WM to rise even further in the coming days. and to even add more to the fire, there are also rumors of a buyout emerging. there just seems to be a bunch of things happening that have the potential to shoot WMs price upward. But this is just my view and i may be completely wrong. if so, let me know your thoughts. also, even if there is a drop in price, i will probably still be able to get out above my entry point.
thats exactly what im thinking. i guess the only thing that can go wrong is that the "deal" gets done at a lower price than it is trading at. What are the chances of that happening in your opinion?